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Will your medical aid pay 100% of the cost for a stay in hospital?

Maybe…maybe not. But I wouldn’t bet on it if I was you.

Could I ask you to carefully read what is written below – and take action? This article could one day save you, or your loved ones, thousands of Rands. I believe that with all my heart.

So let’s listen to what Mike had to say on the topic…

“But my medical aid scheme says I’m covered 100%?”

Mike is absolutely correct – he is covered at 100%. But just not in the way he thinks.
Maybe, you too believe that Mike is correct, but then I have a question for you…

Why does your medical aid scheme offer some plans at 100% while others are offered at 200% cover?

Let’s take Discovery Health for example.

Their top of the range Executive option offers ‘in hospital’ cover at 300% while their Classic plans cover you at 200%. Their Essential plans, on the other hand, cover you at only 100%.

So why would one plan pay 300% and another 100%?

Now follow my logic here.
Assume for a moment that an operation costs R10, 000.

If the 100% option covers 100% of the expense, does it mean that the R10, 000 operation is paid in full?
If this is the case, then won’t the 200% option pays R20, 000? And the 300% option, R30, 000?

But why would they pay R30, 000 if the operation only cost R10, 000?
Remember, medical aid isn’t life insurance. Medical aid is there to pay for the cost of medical treatment – they, and that also means you, aren’t allowed to make a profit from it.

So what’s the real truth then?

The truth is they’re paying 100% of the (INSERT THE NAME OF YOUR MEDICAL AID SCHEME HERE) health rate as determined by your scheme.

  • If your scheme reckons that the operation should cost R10, 000, then 100% of the scheme rate is R10, 000.
  • But just in case the specialist treating you charges more than R10, 000 – they’re offering different plans covering you at 200% or 300% of their scheme rate.

Now for a scheme to even offer a 300% rate, means they’re aware that some specialists do charge that much.

And here is what more and more people are finding out

Specialists are charging more for their services than what medical aid schemes are willing to pay. That’s it…bottom line!

And this has spawned a brand new industry – Medical gap cover.

Medical gap cover is a short term insurance product similar to car and home insurance.

With car insurance you need to be the owner of a vehicle in order to take out insurance on it. I, in other words, cannot take out insurance on your car or on your home.

With medical gap cover, the one requirement is you need to belong to a medical aid scheme. If you end up in hospital, then they will pay the difference between what the specialist charges, and what the medical aid is prepared to pay.

This they will do but with two conditions:

  1. That they limit the cover to a predetermined amount. The company I use, takes your medical scheme rate and bumps that up from whatever it is currently to 500%. So, if you’re on the Discovery Health Essential options offering 100%, then they will bump it from 100% to 500% of the Discovery Health rate.
  2. That the procedure must have been authorised by your medical aid scheme in the first place. So let’s use the example of co-payments. The Discovery Health Core plans (Hospital plans in other words) don’t pay for MRI and CT scans at all. This means that the gap cover company won’t pay for the scans either.

So here’s an example of what could happen if you don’t have gap cover.

Click on image to enlarge:

Why you need gap cover

  • Firstly look at what the specialists charged – R72, 234
  • Then look at what the medical aid scheme paid – R30, 554. That’s what, 42% of the bill?
  • The gap cover company paid R41, 680 – call it 60% of the bill!

So here’s a thought I want to leave you with.

Let’s say…

  • You’re spending R1, 000 a month on medical aid right now.
  • A medical aid which might only pay 40% of your hospital bill. The problem you have is that you’ll only find out when you come out of hospital. If you don’t believe me, phone your medical scheme and ask them how much they’d pay if you were admitted for a triple bypass.

I want to stress that I’m not knocking medical aid companies. At the end of the day there’s only so much money to go around, and they need to decide where best to allocate it.

Now ask yourself…

  • Is it worthwhile spending R160 a month to have the remaining 60% of your hospital bill paid?
  • And that’s not R160 per person – that’s R160 for your entire family!

And finally…

    • If you’ve got a mom or dad who’s approaching the age of 65, you know they need this more than ever. Let them know that once they turn 65, there’s a good chance they might not accept their application at the same cost.
    • And if they’re approaching 80, the gap cover companies might not accept them at all

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Kind regards,

The InsuranceFundi Team

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